Aiding Car Producers in the EU: Money in Search of a Strategy

We investigate how the general principles of the Treaty have been applied to the car sector in the EU, given the specific soft law provisions which are typical of the sector. A detailed quantitative analysis from 1990 to 2008 highlights a reduction of aid over time. A shift from sectoral to Òregional developmentÓ motives in granting aid to the sector is also observed in the last ten years. However, sector specific aid is now less explicit but it remains important. Large amounts of public money are spent without a consistent strategy, reducing capacity in some cases, expanding it in others. The scarcity of public funds calls for a more focussed European policy for this industry.